Obama’s Chief Auto Adviser Steps Down
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By MICHAEL J. de la MERCED and DANNY HAKIM
Published: July 13, 2009
Steven Rattner is quitting his post as President Obama’s chief adviser on the troubled automobile industry at a time when an investigation into his former Wall Street firm’s role in a scandal involving public pension funds has intensified.Mr. Rattner, who has won plaudits for directing the rapid restructuring of General Motors and Chrysler, has been under a cloud since shortly after arriving in Washington in late February after it was disclosed that his firm, the Quadrangle Group, made payments to middlemen that helped it win state pension business.Mr. Rattner could not be reached for comment. A spokesman for Quadrangle declined to comment.
An investigation by New York Attorney General Andrew M. Cuomo has picked up in recent weeks, according to people briefed on the matter who did not want to be identified for fear of jeopardizing the inquiry. Quadrangle faces potential civil charges and is said to be eager to resolve the matter, according to these people, who said that Mr. Rattner has separate counsel from Quadrangle, and that discussions have accelerated among the various parties recently.
Several other firms, including the Carlyle Group, a prominent private equity firm, have already paid fines and agreed to change their business practices as a result of payments they made to get pension business.
A fine against Quadrangle could make it difficult for Mr. Rattner to remain in a position of authority in Washington, given his role in the matter. Mr. Rattner, according to people close to the investigation, arranged for his investment firm to pay $1.1 million to an agent who helped Quadrangle obtain New York pension business. The agent who received most of that money has been indicted and accused of selling access to the pension fund, but neither Mr. Rattner nor Quadrangle is expected to face criminal charges, according to people close to the matter. The Securities and Exchange Commission is also investigating pension fund abuses.
The investigations in Quadrangle have raised questions about the political ambitions of Mr. Rattner. A major Democratic Party contributor, he backed Senator Hillary Rodham Clinton’s presidential campaign, and some speculated that he would have been interested in a major position in a Clinton administration, possibly as Treasury secretary. His wife, Maureen White, was Mrs. Clinton’s finance co-chairwoman. |
